Consumer Mobility, Offline and Online Regional Trade: Evidence from High-Frequency Transaction Data
54 Pages Posted: 20 Aug 2020 Last revised: 6 May 2024
Date Written: June 11, 2020
Abstract
The evolution of consumer expenditure toward online purchasing may have substantial implications for trade patterns, and several studies have found a lower effect of distance in online purchases. The present study analyzes these effects in a broader set of consumer-merchant transactions than previous data have permitted, and at a fine scale, using inter-regional gravity models estimated on billions of card transactions. We use geo-located card transactions to build consumer mobility and inter-regional trade measures, allowing comparison of online and offline inter-regional purchases on a common sample of merchants which each conduct both offline and online card transactions, selected for unambiguous identification of region. Using data from France in the last pre-pandemic year, 2019, we find the effect of distance to be on average 46% smaller online than offline
and more heavily concentrated in the already-larger regional economies. With data dis-aggregated by product category, we find that the distance-effect reduction is most pronounced for durable goods and is also substantial for non-durable goods, with reductions in the effect of distance of around 70% and 45% on average respectively, compared with offline transactions. By contrast we find a negligible impact on services that are consumed in the same location regardless of purchasing channel. We show that these results are robust to various sample and model variations.
Keywords: consumption expenditure, consumer mobility, gravity model, inter-regional trade, e-commerce
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